Knowledge Base

Frequently Asked Questions

Education Credits (American Opportunity and Lifetime Learning Credits) - Form 8863

Form 8863 allows you to claim education credits, which include the American Opportunity Credit and the Lifetime Learning Credit.

The credits are based on the qualified education expenses you paid to an eligible postsecondary educational institution over the course of the year.

There are several differences between the two credits. For example, the American Opportunity Credit is partly refundable, has a maximum of $2,500, and cuts off above incomes of $90,000 for single filers and $180,000 for married filing jointly.

The Lifetime Learning Credit, on the other hand, is not refundable, has a maximum of $2,000, and cuts off above incomes of $61,000 for single filers and $122,000 for married filing jointly. For further details on the two credits’ differing characteristics and eligibilities, refer to Table 1 of the IRS Instructions for Form 8863.

Be aware that you may be able to take a tuition and fees deduction for yourself, a spouse, or a dependent instead of taking an education credit. Calculate which gives you the biggest benefit before you claim one.